Lost in the headlines of yesterday’s special election is the fact that State Senator Barbara Buono would not rule out raising New Jersey’s 7% sales tax, if elected governor, during her debate with Governor Chris Christie on Tuesday night.
Governor Christie noted that the Democrats, with Buono as the Senate Budget Chair, shut down New Jersey’s government in 2006 when Jon Corzine was governor, because they couldn’t agree how high to raise the sales tax.
Assembly Republican Budget Officer Declarn O’Scanlon issued the following statement regarding Buono’s taxing vision for New Jersey:
“Sen. Buono tells everyone that she doesn’t believe in ‘trickle down’ economics. But her failure to rule out an increase in the sales tax clearly shows she is fine with sending a tsunami of economic pain on middle class workers and their families.
“At a time when New Jersey is in the middle of an economic recovery, she has no concept of what a public policy disaster that proposal would be to creating jobs and maintaining our momentum. Increasing the sales tax is regressive and would further impact the most heavily taxed people in the country. It effectively sends the message to consumers to shop elsewhere and keeps New Jersey from being competitive with surrounding states. I am glad she no longer chairs the Senate Budget Committee. We are still trying to recover from the damage done to our economy.
Posted: October 17th, 2013 | Author: Art Gallagher | Filed under: 2013 Election, 2013 Gubernatorial Politics, Barbara Buono, Declan O'Scanlon, Taxes | Tags: Barbariea Buono, Declan O'Scanlon, Governor Christie, Sales Tax | 4 Comments »
“The fact that Sen. Buono doesn’t regret any of the 150-plus tax increases she voted for during her time in the Legislature tells voters she has no remorse for taking their hard-earned money out of their pocketbooks. One would have thought she learned of all the harm all those taxes inflicted. People moved out of our state. Businesses either relocated or expanded their operations elsewhere. Sen. Buono’s economic policies would send our state back to the same place where we were for the eight years Democrats had total control of Trenton . Those days are finished and so is Sen. Buono’s career in politics.”
Since a 1992 U.S. Supreme Court ruling (Quill v North Dakota) online sales have largely been exempt for state sales taxes. In Quill, SCOTUS ruled that sellers did not have to collect sales taxes unless they had a physical presence in the home state of the buyer.
Consumers in many states, including New Jersey, are required to pay the sales taxes on online purchases themselves. Few do and few states do anything to enforce the tax.
In 1992 online sales were not such a big deal. However 20 years later, America makes $200 billion per year in online retail purchases and states are losing out on $23 billion in sales tax revenue, according to a Washington Post report.
Large “brick and motar” retailers complain that the online exemption creates a pricing disadvantage for them and a cost, as consumers shop for items in their show rooms but then purchase items online at the lower price, often from smart phones while still in the retail show room.
Local retailer Vic Scudiery, owner Hazlet electronics seller IEI and the former Chairman of the Monmouth County Democratic Party, has long held that the state is losing out by not taxing online sales. Scudiery told MMM that IEI’s monthly sales tax paid to New Jersey was over $20 thousand before the majority of its sales shifted from store visits to the Internet. Now, Scudiery says his store generates less than $8000 per month in sales tax for New Jersey while overall revenues continue to grow.
Mega online retailer Amazon had long been opposed to collecting sales taxes, in part because the process of collecting and reporting sales taxes for thousand of jurisdictions is too cumbersome and confusing. But Amazon has abandoned that argument as it has changed its business model. As the company aggressively opening new distribution centers in many states, including New Jersey, to reduce the time and cost of its shipping of consumer products, it is cutting deals with states that would allow it avoid collecting sales tax for a year or two and get state income tax credits if they build and hire. In New Jersey, Amazon will build two huge distribution centers, create 1500 jobs. The company will start collecting New Jersey’s 7% sales tax from Jersey residents in July of next year under a voluntary agreement with the Christie administration.
trade association lobbyist, who’s members clients include eBay, facebook, Overstock.com and Internet wine sellers, are continuing to fight sales taxes based on the complicated and cumbersome argument.
Bi-partisan federal legislation, The Marketplace Equality Act, would authorize states to collect sales tax from online retailers shipping products into their jurisdictions and require, that if the states choice to impose that tax collection on retailers, that they simplify the process and, in some circumstances, provide software to the sellers that would calculate the appropriate tax.
Republican governors, lead by Gov. Chris Christie, have dropped their long term opposition to taxing online sales and endorsed the Marketplace Equality Act, according to the Wall Street Journal.
Posted: July 16th, 2012 | Author: Art Gallagher | Filed under: Taxes | Tags: Amazon, Chris Christie, e-sales tax, eBay, Facebook, IEI, Marketplace Equality Act, NetChoice, online sales tax, Overstock.com, Republican governors, Sales Tax, Victor Scudiery | 10 Comments »
By Assemblywoman Caroline Casagrande
What do Florida, New Hampshire and Washington state have in common?
They’re among nine states that not only weathered the worst economic recession of our generation, but found ways to make their economies stronger, attract new people and create jobs when the rest of the nation floundered.
From 2001 to 2010, these nine states saw employment increase by 5.4 percent when the rest of the country remained stagnant.
What do these states have in common that allows them to grow jobs during horrific economic times?
No income tax.
In New Jersey, we’re on our way to replicating the job-creating economic successes of these “prime nine” states, even though we’re still among the “maligned nine” states with the highest income taxes.
The tax-free states grew employment by 5.4 percent, while tax-heavy states saw jobs decline by 1.7 percent.
That’s why Gov. Christie is proposing to cut income taxes for everyone. It will keep money in people’s pockets and help bring back the jobs that disappeared last decade as Trenton taxed and spent the state into economic ruin.
The Wall Street Journal recently called legislative proposals in other states to cut the income tax good “long-term growth” and attempts to use additional income tax revenue to relieve property taxes “short-term politics.”
It’s not even good short-term politics. Remember what happened to Jon Corzine in 2009 when he raised income taxes? He was one of nearly 120,000 New Jerseyans who lost a job that year.
Franklin D. Roosevelt, who knew something about emerging from horrific economic times, once said: “Do something. If it works, do more of it. If it doesn’t, do something else.”
New Jersey has repeatedly tried raising taxes to relieve property taxes. It has never worked. In fact, the income tax itself began as a way to reduce property taxes. Do you know anyone whose property taxes went down since 1976?
New Jersey lost an entire decade (and 156,000 jobs) proving you can’t lower one tax by raising another. Taxes increased by $11 billion from 2002 to 2009, and nearly every time they increased a tax, Trenton politicians promised it would relieve property taxes, yet the property tax burden increased 6 percent per year and 60 percent cumulatively from 2002 to 2010.
Remember when Trenton politicians shut down the state to raise the sales tax in 2006 to offer “historic” levels of property tax relief? It didn’t work. The higher sales tax remains, but the property tax relief was history after just one year.
We need to stop doing what doesn’t work. That’s why we ended those failed tactics and launched the most aggressive and effective assault on property taxes in New Jersey history.
We put a tight cap on property taxes, saved property taxpayers $120 billion over the next 30 years through pension and health care reform, and we are working to do more, such as ending the payout for workers’ unused sick and vacation time and allowing towns to save money by opting out of Civil Service.
Our comprehensive approach to tax reform has businesses and homeowners optimistic about our state’s future for the first time in several years.
If we continue to do what has been working, we will continue to create more private-sector jobs in addition to the 60,000 that have been added in the past two years.
Adding jobs won’t just improve our unemployment rate, but likely will achieve precisely what short-sighted critics of Gov. Chris Christie’s income tax cut say it won’t: property tax relief.
Raising other taxes has not lowered property taxes, but reducing the income tax may because it will keep forcing government to spend within its means while encouraging businesses to create jobs in New Jersey.
More businesses and jobs in our economy means a greater share of the tax burden is shifted away from property taxpayers.
Many other states have seen the wisdom of low income tax rates. They know that reducing the income tax burden creates jobs and builds a strong economic foundation. I’m eager to see New Jersey follow suit.
In the last two years, New Jersey has added more than 62,000 private-sector jobs. And our Economic Outlook Rank has improved from 48th to 45th this year, according to the American Legislative Exchange Council.
Our plan to make New Jersey affordable and create jobs is working. We can’t stop doing what is working. We need to do more.
Posted: March 9th, 2012 | Author: Art Gallagher | Filed under: Art Gallagher, Caroline Casagrande, Taxes | Tags: American Legislative Exchange Council, Assemblywoman, Assemblywoman Caroline Casagrande, Caroline Casagrande, Civil Service, Florida, Franklin D. Roosevelt, Goveror Chris Christie, Income Tax, New Hampshire, New Jersey, Property Tax, Sales Tax, Taxes, Trenton, Wall Street Journal, Washington | 7 Comments »